HONG KONG AIR POLLUTION DETERRING EXPATS, SAYS

UNCLAS HONG KONG 002313

SIPDIS

SENSITIVE
SIPDIS

STATE FOR EAP/CM AND OES/E

E.O. 12958: N/A
TAGS: SENV ENRG PGOV HK
SUBJECT: HONG KONG AIR POLLUTION DETERRING EXPATS, SAYS
AMCHAM SURVEY


1. (U) Air pollution increasingly is harming Hong Kong's
attractiveness as a posting for expat executives, according
to the American Chamber of Commerce in Hong Kong's second
annual environment survey. Fifty-one percent of respondents
claimed difficulty in recruiting professionals to work in the
city, as a result. The survey, to be released on September
10, shows marine water quality and traffic congestion ranking
second and third as top influencing factors, with concern
about traffic congestion increasing from 49 to 60 percentage
points in just one year. Overall, 81 percent of respondents
are not/not confident that the natural environment of Hong
Kong will improve in the next twelve months. Reduction of
transport emissions and gaining mainland China cooperation
are cited as the most important actions that the Hong Kong
government could take to change that outcome. AmCham
President Jack Maisano said, "It's not that the Hong Kong
government has been standing still, it's that international
executives do not see a bold and clearly articulated
prescription for progress."


2. (U) The survey focused on two areas, the quality of Hong
Kong's environment, and potential Hong Kong government
solutions. The survey respondents indicated the following:

-Hong Kong's attractiveness to foreign investors is expected
to drop in the future (78 percent agreed).
-Companies will invest elsewhere (57 percent agreed).
-More foreign professionals are thinking of leaving Hong
Kong, 83 percent vs. 78 percent in the 2006 survey.
-They personally know foreign professionals who have declined
employment in Hong Kong due to the environmental quality (70
percent in 2007, an increase of 15 percntage points since
2006).

Suggested governmentsolutions, in rank order, include:

-Reduce polltion by transport (reduce emissions and the
numbr of vehicles);
-Work with local Chinese governmnts to cleanup mainland
China;
-Educate the pulic and Hong Kong companies who own factories
in ainland China; and
-Impose laws/taxes/penalties.


3. (U) The Survey: The 2007 Environment Survey was
administered by The Nielsen Company, and sent to 628 AmCham
member companies. The survey had a rather low response rate
of 14 percent (89 responents),and a margin of error of
plus/minus 5.3 percent. This is the second annual survey,
initiated to measure AmCham member views on environmental
quality and competitiveness. Survey details and graphics can
be found at: www.amcham.org.hk.


4. (SBU) Comment: The survey provides tangible data to
support anecdotal evidence that the expatriate community in
Hong Kong views environmental issues seriously, and is making
financial and personal decisions with these issues in mind.
Additionally, the survey is generating broad media attention.
A senior environmental protection officer said that the Hong
Kong government, including the Chief Executive, had noted the
survey and that they would continue to work on solutions.


5. (SBU) Comment, continued: Unquestionably worsening air
pollution in Hong Kong is becoming an important political and
economic issue, and the AmCham survey has usefully tried to
quantify this fact. That said, the relatively low response
rate weakens the impact of the data represented.
Furthermore, the Hong Kong government reports a growing
number of overseas companies registering in Hong Kong,
reflecting Hong Kong's importance as a regional business
center, with total foreign registrations growing by at least
200 companies for each of the last five years. End comment.
Cunningham